Bally’s Corporation to Buy Out UK Online Operator Gamesys; Final Valuation Over $2.5 billion
US land-based casino giant Bally’s Corporation, not to be confused with slot developer Bally Technologies, has confirmed this week it has tabled a $2.7 billion takeover bid for British online casino firm Gamesys.
Shortly after, Gamesys’ board told shareholders they intended to accept the offer. Between board members, founders, and other executives, they hold about 30.7% of Gamesys’ shares.
The UK-based company, owner of online casinos such as Jackpot Joy, saw a stellar performance in 2020, with share prices rising as much as 150% year-on-year.
This deal will see Bally’s pay $25.42 per Gamesys share. That makes for a 12.7% premium on Gamesys’ closing share price on March 23.
Bally’s has been aggressively expanding over the last year. Just this week, it was selected as a finalist in the bidding process for a new $650 million physical casino resort in Richmond, Virginia, and it also recently acquired sports betting platform Bet.Works.
Meanwhile, Gamesys just launched a brand-new casino for the UK market based around popular MegaWays slot games.
“Bally’s and Gamesys believe that having a combination of both proven, developed technology and land-based platforms across key US states, with global brands, existing customer bases and complementary product offerings will be key to taking advantage of these growth opportunities”combined company statement
It’s also one of the few European online casino operators to own its own white-label platform and in-house development team.
After the news of the deal with Bally’s broke, Gamesys’ shares rose 18% in one afternoon, reports London’s Financial Times.
If the deal is completed – and most analysts seem to expect it will – the current Gamesys CEO Lee Fenton will become head of the combined company.
The new entity, whether it keeps the same name or not, will become a US-based company with headquarters in Rhode Island.
Current Bally’s CEO George Papanier will keep a place on the board of the newly-formed group. He will, however, focus on his new role as head of Bally’s land-based casino properties across the US.
The company currently runs 11 casinos and three racecourses. It’s obviously interested in expanding its online presence, too, as indicated by this most recent purchase and that of Bet.Works.
This purchase, although a big-money deal by anyone’s standards, is hardly the biggest of the past few years.
The long-awaited merger between Caesars and UK-bookmaker William Hill is soon to complete – worth some $2.9 billion.
But both deals are dwarfed by two other mergers that happened last year.
Caesars itself merged with fellow US casino giant El Dorado Resorts in a $20 billion deal, and Europe’s Flutter Entertainment merged with PokerStars owner the Stars Group in a $12 billion merger last May.
All concerned parties are probably looking towards the US market. The COVID pandemic has drained the cash reserves and income streams of many states, and online gambling could be an attractive tax provider for many that have not yet considered it.
This new deal between Bally’s and Gamesys certainly won’t be the last of its kind.
Big online casino companies merging with physical land-based businesses across the US may become more common as more states develop their legal markets.
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